US, China agree to abandon trade war: Beijing
Chinese Vice-Premier says both sides 'will stop increasing tariffs on each other'
BEIJING Washington and Beijing have agreed to abandon any trade war and back off from imposing tariffs on each other, Chinese state media reported yesterday.
The announcement came after high-level talks in the US capital and followed months of tensions over what President Donald Trump has blasted as an unfair commercial relationship between the two economic giants.
According to state-run news agency Xinhua, Vice-Premier Liu He, who led Chinese negotiators in Washington, said: "The two sides reached a consensus, will not fight a trade war, and will stop increasing tariffs on each other."
Mr Liu called the agreement a "necessity" but added: "At the same time it must be realised that unfreezing the ice cannot be done in a day, solving the structural problems of the economic and trade relations between the two countries will take time."
An earlier joint statement issued in Washington said Beijing would "significantly" increase its purchases of US goods, but offered few details.
The apparent detente comes after months of increasing tensions that have set markets on edge over fears of a trade war.
Mr Trump has repeatedly railed against his country's trade deficit with China, describing it as a danger to US national security and threatening to impose tariffs on billions of dollars' worth of Chinese goods.
US levies on US$50 billion (S$67 billion) of Chinese imports could have come into effect as early as next week.
The talks in Washington were between delegations led by US Treasury Secretary Steven Mnuchin and Mr Liu, who also met Mr Trump last week. The sides had met earlier in Beijing.
CONSENSUS
"There was a consensus on taking effective measures to substantially reduce the US trade deficit in goods with China," the joint statement said.
"To meet the growing consumption needs of the Chinese people and the need for high-quality economic development, China will significantly increase purchases of United States goods and services."
Last year, the US had a US$375.2 billion trade deficit with China, with populist politicians blaming the Asian powerhouse for the leeching of US jobs over the last few decades.
Washington reportedly had demanded the deficit be slashed by at least US$200 billion by 2020. The joint statement held no indication that China had assented to that target.
It said both sides had agreed on "meaningful increases" in US agriculture and energy exports. Mr Liu said the new trade cooperation would extend to medical care, high-tech products and finance, according to Xinhua.
They also agreed to strengthen cooperation on protecting intellectual property - a long-standing source of US discontent.
The two countries opened the delicate negotiations a few weeks ago.- AFP
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